Fundamentals of price movement

[Luxen 0]

Hello BBTs,

 

i am still very new to trading and currently in the state of understanding the fundamentals of it. So i got stuck with the following questions :

1. How exactly does the price move? I learned that the price makes an uptick when a transaction is made on the "ask" (aggresive buyer) and a downtick when a transaction is made on the "bid" (aggresive seller). But when I watch the Level 2 and the Time and Sales within DAS I sometimes see that there are transactions made wheather at/above the ask/bid or inside and the price doesnt move. Happens very often in the premarket and a shares traded <100 (Lot-size 0)
2. How can a transaction be performed inside of a spread when there are only the possibilities to wheather set a price  and wait that someone accepts it (limit order) or to accept a price yourself (market order) wheather on the bid or ask side?
3. Sometimes I see on the top of Level 2 a bid and an ask and they are just 0.01 apart from each other but the spread on Level 1 shows a wider spread. How does this come?

 

I am really looking forward to your answers and would be more than happy if you could help me with these questions.

 

Have a nice day

 

Lukas

[39225303 0]

6 hours ago, Luxen said:

Hello BBTs,

 

i am still very new to trading and currently in the state of understanding the fundamentals of it. So i got stuck with the following questions :

1. How exactly does the price move? I learned that the price makes an uptick when a transaction is made on the "ask" (aggresive buyer) and a downtick when a transaction is made on the "bid" (aggresive seller). But when I watch the Level 2 and the Time and Sales within DAS I sometimes see that there are transactions made wheather at/above the ask/bid or inside and the price doesnt move. Happens very often in the premarket and a shares traded <100 (Lot-size 0)
2. How can a transaction be performed inside of a spread when there are only the possibilities to wheather set a price  and wait that someone accepts it (limit order) or to accept a price yourself (market order) wheather on the bid or ask side?
3. Sometimes I see on the top of Level 2 a bid and an ask and they are just 0.01 apart from each other but the spread on Level 1 shows a wider spread. How does this come?

 

I am really looking forward to your answers and would be more than happy if you could help me with these questions.

 

Have a nice day

 

Lukas

 

[Alastair 110]

@Luxen U are getting very specific....u are really thinking and observing. I like details too.  Seems like u could be a great scalper in the making. Responding to ur questions below:

1.  U on the right track here.  Uptick if the order is filled above last/previous price only.  If the price did not move the order was aggressive but not aggressive enough (small quantity).  This a potential signal if ur at support/resistance.

2.  See ALL my comments here...........https://forums.bearbulltraders.com/topic/3101-level-2-tape-reading/?tab=comments#comment-22588

3. L2 is the future will potentially happen next in another nano second maybe.  L1 is what just completed.

hope that helps......